Alternative Views: Why the ringgit’s appreciation is losing its momentum for now
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For the first time since 2007, Malaysia's foreign currency account (FCA) deposits dropped by RM11 billion to RM246 billion in August 2024; FCA deposits had previously risen consistently, with a historical low of RM21.4 billion in January 2007 and a peak of RM247 billion in January 2024; the decline is attributed to exporters potentially converting more proceeds into ringgit due to a weakening US dollar; Bank Negara Malaysia is encouraging this conversion with assurances of easy approvals; the US dollar's weakness is linked to a slowing US economy and recent Federal Reserve rate cuts; the ringgit has appreciated nearly 10% against the US dollar this year; Malaysia's economy grew by 5.9% in Q2 2024, with exports increasing by 8.4%; concerns exist that continued appreciation of the ringgit could negatively impact the export-driven economy; predictions suggest the ringgit may reach RM3.55 against the US dollar by the end of next year; Prime Minister Anwar Ibrahim is noted for fostering good international relations and attracting foreign investments.
#Ringgit #Malaysia #ForeignCurrencyAccount #BankNegara #UsDollar #Economy #Exports #AnwarIbrahim #InterestRates #ForeignInvestment
https://theedgemalaysia.com/node/729206
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